Moinian sues HPD over Sky’s 421a status

Debate brews over construction start date of 2008 or 2014

New York /
Nov.November 10, 2016 02:00 PM

The Moinian Group, the developer behind the 61-story rental tower Sky, is suing the New York City Department of Housing Preservation and Development to reverse the agency’s decision regarding the project’s 421a benefits.

What’s under debate is when construction on the Midtown project at 605 West 42nd Street officially launched. Moinian claims it began in 2014, but HPD recognizes the construction start date as June 2008, which significantly decreases the tax incentives Moinian would receive under the 421a program, according to a petition filed Wednesday in New York State Supreme Court.

Under 421a, developers receive tax exemptions for eligible buildings for a construction period of up to three years, followed by decreasing tax abatements over a period of 10 to 25 years depending on various factors. If Sky began construction in 2014, Moinian would still be within the three-year construction phase and the project would be tax-exempt.

The current proposal for Sky is based on plans approved by the Department of Buildings in October 2014, which differ significantly different from a previous design approved in 2008. The new building is 15 stories taller, spans 1.2 million square feet instead of 880,976, and includes 1,175 units instead of 764. The new building is also expected to include 235 affordable units and a public health club featuring multiple swimming pools, neither of which were included in earlier plans.

According to Moinian TRData LogoTINY, that should make him eligible to 421a benefits beginning in 2014, putting him early in the benefit cycle.

Construction on the earlier version began in 2008 but was stalled in 2009. A previous 421a application for the site, submitted by Moinian in 2012, cited the 2008 start date.

Moinian is seeking a court order annulling the HPD’s determination and accepting an official construction start date of October 2014.

Neither Moinian nor the HPD responded to requests for comment.


Related Articles

arrow_forward_ios
John Catsimatidis and 670 Pacific Street (Getty, StreetEasy)
Catsimatidis notches win for landlords in 421a suit; tenants vow to appeal
Catsimatidis notches win for landlords in 421a suit; tenants vow to appeal
Brookfield Properties CEO Brian Kingston and New York City’s Housing Commissioner Louise Carroll (Brookfield, NYC Housing Preservation & Development)
Brookfield suit aims to crack the code of 421a
Brookfield suit aims to crack the code of 421a
Vornado's Steve Roth and a rendering of 93-30 93rd Street (Getty, JLL)
Vornado looks to sell Rego Park development site for $85M
Vornado looks to sell Rego Park development site for $85M
Joe Moinian with 123 Linden Blvd (The Moinian Group)
Moinian nabs $223M refi for Flatbush apartment complex
Moinian nabs $223M refi for Flatbush apartment complex
Gary LaBarbera, Sen. Salazar and Sen. Gianaris (Getty)
Real estate winners and losers of the legislative session
Real estate winners and losers of the legislative session
REBNY's James Whelan, Sen. Brad Hoylman and Assemblymember Emily Gallagher (Getty, Whelan via Anuja Shakya)
Bill to audit 421a gets hearing as pols put subsidy in crosshairs
Bill to audit 421a gets hearing as pols put subsidy in crosshairs
(Moinian Group, CVS)
CVS signs lease for 512 7th Avenue store
CVS signs lease for 512 7th Avenue store
Joe Moinian and Marc Holliday with a rendering of 605 West 42nd Street (Moinian, SL Green, Hill West Architects)
Moinian deal with SL Green values Sky apartments at $850M
Moinian deal with SL Green values Sky apartments at $850M
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...